Advanced Micro Devices (AMD 2.37%) stock slipped in Tuesday's trading. The semiconductor company's share price closed out the daily session down 4.8%, according to data from S&P Global Market Intelligence. Nvidia, its chief rival in the graphics processing unit (GPU) space, actually gained 1.1% in the session.
There wasn't any business-specific news that dragged AMD stock lower today, but the company's share price lost ground following the opening of Nvidia's GPU Technology Conference (GTC) yesterday. Good news for Nvidia stock has often helped increase bullish sentiment for AMD stock, even though the two companies are competitors.
While Nvidia did manage to post small gains in Tuesday's trading and analysts appear to be excited about the next-generation Blackwell chip that the company unveiled yesterday, other high-profile artificial intelligence (AI) stocks lost ground today. Investors seem to have been betting that AI stocks would surge following announcements at GTC. When that didn't materialize for AMD, some investors opted to sell out of the stock.
Is AMD stock a buy right now?
AMD has been on a tear over the last year. Investors have poured into the stock in anticipation of potentially massive AI-related demand tailwinds on the horizon. Even with today's valuation pullback, the company's share price is still up 23% across 2024's trading and roughly 85% over the last year.
But while Nvidia has seen explosive sales and earnings growth as enterprises and institutions have purchased its GPUs to run artificial intelligence applications, AI isn't powering huge growth for AMD just yet. For reference, AMD increased sales roughly 10% year over year in last year's fourth quarter, and its midpoint guidance calls for sales to be approximately flat in this year's first quarter. Meanwhile, Nvidia grew sales 265% year over year in Q4 and is guiding for growth of roughly 234% in this year's first quarter.
For long-term investors, building a position in AMD stock still looks like a worthwhile move -- and it's possible that artificial intelligence will lead to growth acceleration later this year. But the stock actually looks riskier than Nvidia right now because its outlook in the AI space is more speculative.
